Does a voice recognition acquisition point to an Amazon smartphone?

Amazon.com Inc. reportedly has acquired voice recognition company and virtual personal assistant mobile app EVI for $26 million. EVI is very similar to Apple Inc.’s Siri, the iPhone’s virtual personal assistant that understands speech and responds, and is available in Apple Inc.’s App Store and the Google Play app store. The EVI move follows Amazon’s January acquisition of text-to-speech technology company Ivona Software. Ivona is the voice technology behind the “Text-to-Speech,” “Voice Guide” and “Explore by Touch” features on Kindle Fire tablets.

Mobile industry analysts believe reports of the acquisition and feel an EVI purchase makes sense for Amazon, which has so many successful hardware offerings, including the line of Kindle e-readers and the line of Kindle Fire tablets, on which voice recognition could play an important new role. But some have been speculating Amazon is getting into the smartphone business, especially after a July 2012 Bloomberg report indicated Amazon had tapped Android device maker Foxconn to produce an Amazon smartphone.

A Siri-like voice offering from EVI fuels more smartphone speculation. But analysts say a smartphone is just one possible reason for Amazon doubling down on voice technology.

“It is not clear that EVI has anything to do with Amazon building its own smartphone—it could be intended to provide voice-enabled commerce of some kind,” says Avi Greengart, research director, consumer devices, at research firm Current Analysis Inc. “However, Amazon is extremely ambitious and would like to control as much of the mobile platform as it can. It has shown it is willing to build hardware for e-reading and for mobile media consumption.”

The price tag for a “Kindle phone” could present a challenge in the highly competitive smartphone market, Greengart adds.

“A Kindle smartphone would have to contend with other devices’ carrier subsidies, which hide the true cost of a smartphone from consumers,” he says. “However, it’s possible that Amazon would try to take advantage of two trends: consumer willingness to buy phones with extremely large displays, which are better for browsing and content consumption; and carriers like T-Mobile USA that are going subsidy-free.”

A phone could be a difficult proposition for Amazon because the e-retailer might need to get into the business of creating and maintaining relationships with wireless carriers, says Sucharita Mulpuru, vice president and principal analyst at Forrester Research Inc.

“EVI may be for a smartphone, or it may just be for a smarter Kindle,” Mulpuru says. “EVI could just be to help people search on a Kindle. Or it could be to get some smart mobile development talent, which is scarce these days.” Mulpuru calls that kind of company acquisition an “aquihire.”

Greengart also says buying talent could be the driving force behind the EVI acquisition.

The EVI app runs on any iPhone or Android smartphone and is free. It uses natural language voice recognition technology to understand what an app user means. It includes a search engine that helps it find answers to users’ questions, answers that are spoken to users as well as displayed on screen. And the app’s voice technology can be used to send text messages, make calls and schedule calendar events.